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Lobbyists make case at OMB

While the White House has restricted lobbying on the $787 billion
stimulus package, K Street has had plenty of access to administration
officials on other issues.

Lobbyists have met with officials at the Office of Management and Budget to discuss and in some cases moderate regulations regarding a greenhouse gas registry, the so-called Buy American purchasing requirement and an ethanol production mandate. OMB has final say on how proposed federal rules are ultimately written.

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Representatives for the oil-and-gas industry flocked to a half-dozen meetings held by OMB starting in August this year to discuss a controversial rule proposed by the Environmental Protection Agency (EPA) to require companies to disclose their greenhouse gas emissions.

Five of those meetings occurred in a two-day span a little over a week before the rule was finalized by the agency on Sept. 22, according to public records posted on OMB’s website.

More than 50 people attended the six meetings. Lobbyists representing companies like Chevron, BP America and Kinder Morgan were there, along with executives for Exxon Mobil and Shell.

In addition, lobbyists for several trade associations, such as the American Petroleum Institute and the American Paper and Forest Association, attended. Overall, at least nine lobbyists showed up to the meetings.

Administration officials representing EPA and the Office of Information and Regulatory Affairs (OIRA) — the division within OMB that signs off on every rule coming out of the federal government — attended the meetings. No environmentalist groups, however, were at the table.

A review by The Hill of OMB’s meeting records under the Obama administration show that the greenhouse gas reporting rule attracted the most interest from outside groups, based on the number of meetings held to review the issue.

Environmentalists say the lobbying fight is just a forerunner of much larger battles ahead as the administration and Congress look to force carbon dioxide and other greenhouse gas emissions reductions.

“It demonstrates that this is a very important rule when you see lobbyists for the biggest oil companies lining up at the White House trying to massage the final rule,” said Frank O’Donnell, president of Clean Air Watch.

During the George W. Bush administration, OMB was accused of watering down rules proposed by federal agencies in favor of objections from industry lobbyists. Matt Madia, a regulatory policy analyst at OMB Watch, a watchdog group, said OMB had a record of tipping the scales in the favor of the industry.

But both Madia and O’Donnell believe that the final rule on the greenhouse gas registry was not significantly weakened when it was released last month, despite the last-minute push by oil and gas companies.

The rule “is absolutely a critical first step in creating a comprehensive system to reduce greenhouse gases,” O’Donnell said.

In meeting with lobbyists, OMB officials said the agency was following a longstanding executive order that requires OIRA to meet with “anyone who asks and who is also likely to be regulated under a proposed regulation.”

“Because this EPA rule was intended to address all parts of the economy, diverse entities provided comment both to EPA during outreach efforts, through the public comment process and also to OIRA,” OMB spokesman Tom Gavin said.

By contrast, the Obama administration has sought to restrict the ability of lobbyists to influence where federal stimulus dollars go. The White House bans federal officials from talking to lobbyists after a formal project request for funding is filed.

More recently, the administration released guidance to federal agencies suggesting they ban lobbyists from sitting on advisory panels that recommend policy action.

One representative for the oil-and-gas sector said industry representatives were able, during the meetings at OMB, to convince administration officials to tweak the final rule on greenhouse gas emissions reporting requirements.

Roger Martella, a partner at Sidley Austin and outside counsel to the American Petroleum Institute, said he thought the administration was considerate of industry concerns about the rule. Some minor changes, such as not having pollution sources being permanently covered by the rule if they reduce their emissions, were made accordingly, Martella said.

But he said that in other areas, the administration did not address concerns raised in the meetings with OMB.

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“At the same time, there are several outstanding issues that will continue to pose significant challenges in implementation, and discussion is ongoing among stakeholders on a willingness to work collaboratively with EPA on resolving these outstanding issues,” Martella said.

Lobbyists have sought to modify rules in addition to the greenhouse gas reporting rule.

OMB hosted three meetings in March and April this year to discuss a rule being considered by the Defense Department’s Defense Acquisitions Regulations Council. The agency was trying to figure out how best to implement the Buy American provision included in the stimulus package, which is intended to favor domestic industries.

Close to 25 people attended the meetings, at least six of whom were lobbyists representing the United Steelworkers, United Autoworkers and the American Steel and Iron Institute. Also in attendance for one meeting were representatives of the Japanese Embassy, according to public records.

Another rule that earned K Street’s attention was a measure being considered by EPA to institute amendments to the renewable fuel standard that relate to how ethanol’s greenhouse gas emissions are calculated.

More than 40 people overall attended four meetings held in March regarding the rule. At least 11 were lobbyists. Advocates for the American Petroleum Institute and Shell, as well as those for the Environmental Defense Fund and the Union of Concerned Scientists, were in the meetings.